a friend is letting me use their licensed kitchen to cook in their bar..

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Mati1022
Junior Burger
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2011/09/08 13:13:00 (permalink)

a friend is letting me use their licensed kitchen to cook in their bar..

the idea is that i would provide two or three lunch/happy hour-only sandwiches for the blue collar crowd that comes in.  the owner would like to keep my sales separate from the bar sales.. basically running my own separate business out of their kitchen.   this for me is a chance to roll out my idea that's been in the works for about five years experimenting with what works and doesn't - all in a free-to-use licensed kitchen..leading to my own truck to hopefully lead to a small restaurant someday.   i've done two freebie experiment days there,  making my food and giving sample plates to the patrons just to see if they liked it.. everyone LOVED IT.  
my question is should i have my little mini restaurant operation of one registered with the name i eventually plan to use with my business and track everything like a real restaurant would?  it all seems too loose and i'm nervous about just selling food for cash and having it bite me in the butt later on... the owner is just like, 'just cook and sell..don't worry about it'....
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    roadkillgrill
    Cheeseburger
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    Re:a friend is letting me use their licensed kitchen to cook in their bar.. 2011/09/08 15:25:37 (permalink)
    I'm with the owner. "It's better to ask forgiveness than permission." K.I.S.S. always applies....
    #2
    lornaschinske
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    Re:a friend is letting me use their licensed kitchen to cook in their bar.. 2011/09/08 15:50:05 (permalink)
    Mati1022
    ... my question is should i have my little mini restaurant operation of one registered with the name i eventually plan to use with my business and track everything like a real restaurant would?  it all seems too loose and i'm nervous about just selling food for cash and having it bite me in the butt later on...

    Why not do it for real to start with? Registering a business name is nothing. We did in TX but no place else because it wasn't required. A lot of places won't require a registered name if it had your name in it (for us it was D and L Schinske Food Concessions). Now my webpage is under Vardo Food Carts. But I can change that name at anytime as it's not our official business name. Our sales tax is always under my personal name and I file taxes under my personal name. Track just like you would a big restaurant. It will give you a tangible background in case you decide to apply for a loan for your future restaurant. ALSO it will show you where your money is going. Unless this is only going to be a hobby. You need to decide that up front.  As far as I (and the IRS) is concerend, our business is a hobby. We do not want to work it all the time, we want to be able to take off when we want and where we want (our home has wheels). We do not have any loans in regards to our business (or anything else). We have a set amount of $$ we need to make to live on. That is our only interest in what the business needs to provide. We will never expand to a B&M restaurant. We are semi-retired and want to keep it that way. So we really can keep records at a "hobby" level. I do keep pretty good record for our own personal use. No one else will ever see them if I can help it. But you are in a very different situation. You are looking to eventually build this (if you like it) into something bigger. So set it up as a "real" business up front.  Get your food mangers certificate (you can do that online). Doing your sales taxes online is easy as well. Get a simple computer program like Quick Books (or similar) to track your $$. Don't forget when it comes to the IRS and the Health Dept... "Ignorance of the law is no excuse".
    post edited by lornaschinske - 2011/09/08 15:52:45
    #3
    rumaki
    Double Chili Cheeseburger
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    Re:a friend is letting me use their licensed kitchen to cook in their bar.. 2011/09/08 15:54:55 (permalink)
    Whose liability insurance will cover you?
    #4
    Mati1022
    Junior Burger
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    Re:a friend is letting me use their licensed kitchen to cook in their bar.. 2011/09/08 17:00:56 (permalink)
    thanks to all... i think i'll go with the register/hobby advice because that's all this will be for now... i get the whole "keep.it.simple.stupid" theory, but i dont want to L.M.A.I.J.  (land my a$$ in jail) hahaa...  
    btw - the bar will cover insurance - any other advice is more than welcomed!!
    #5
    Mati1022
    Junior Burger
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    Re:a friend is letting me use their licensed kitchen to cook in their bar.. 2011/09/08 17:04:37 (permalink)
    are there different tax laws re business v. hobby level??
    #6
    Foodbme
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    Re:a friend is letting me use their licensed kitchen to cook in their bar.. 2011/09/08 18:16:57 (permalink)
    I'm not sure I understand your question regarding the name for your business. Obviously, the bar has a name. You could operate there without creating a separate Public name, but record your sales under your own separate private company name for accounting and tax purposes. You will need a separate cash register. You could set up under a sole proprietorship, get a tax # and operate that way. You will probably need your own business license.
    I'd consult a CPA to get valid advice for how it's best handled in NJ. 
    It will be a little confusing to customers who order a drink and food to have to pay 2 separate tabs. It could get messy. You need a SOLID Agreement with the bar owner so you both agree on how you're going to handle the $$$ Money logistics.
     
    post edited by Foodbme - 2011/09/08 18:20:14
    #7
    Mati1022
    Junior Burger
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    Re:a friend is letting me use their licensed kitchen to cook in their bar.. 2011/09/11 18:27:33 (permalink)
    thanks all.. i've decided to trust my instincts and back away from this sketchy setup and work on tying up the loose ends in other parts of my plan so when i'm really ready to roll out it'll be done right!
     
    #8
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